DUBLIN Ohio Wendy’s International Inc. could be forced to delay or halt its sale because of potential bidders’ concerns over terms of the seller-arranged financing for the deal, according to media reports.
AWendy’s spokesman would not comment on the speculation, and one of the reports stressed that the auction seemed to be proceeding as planned, with bids due by 5 p.m. today.
“There are no concrete signs of a new schedule or that the deal will be canceled,” Janet Adamy, a restaurant industry reporter for The Wall Street Journal, said in a posting on the paper’s Deal Journal blog.
But, she noted, the financing situation could force Wendy's to "scrap the sale altogether."
Citing unnamed sources, Adamy also reported in the Nov. 9 posting that bidders had not seen the final financing package as of that afternoon. She quoted one source as describing the so-called staple financing as unworkable, and that its providers, J.P. Morgan Chase and Lehman Brothers, were speaking with other financing sources to arrange a more enticing package.
The New York Times today also reported that the auction of Wendy’s “may be in jeopardy” and that a sale could be delayed.
The article said the financing package provided by Wendy’s bankers contains “an escape hatch” that would allow the financiers to yank back their funding if the credit markets continue their deterioration. That uncertainty could scare off potential bidders, the story suggested.
Of the parties said to be interested in buying Wendy’s, Adamy said in her posting on Friday that “William Foley, chairman of Fidelity National Financial, appeared the front runner as of last week.” Foley is a former chairman of CKE Restaurants Inc. and an investor known for his opportunism in purchasing companies. His company is said to be evaluating Wendy’s in concert with the private-equity firms Thomas H. Lee Partners LP, Oaktree Capital Management LP and Ares Management LLC.
Other parties identified as potential suitors include Nelson Peltz, head of Arby’s parent Triarc Cos. Inc., whose various affiliates already hold a 9.8-percent stake in Wendy’s; Gene Carlisle, chairman of Wendy’s franchisee Carlisle Corp., based in Memphis, Tenn.; and David Karam, of Wendy’s franchisee Cedar Enterprises in Columbus, Ohio, with support from Joe Drury, a former Wendy’s operations vice president who recently sold the Bojangles’ chicken chain.
Wendy’s began exploring a sale in April. The company, based here, operates or franchises about 6,600 quick-service restaurants.
